Federal Reserve Running Low on Ammo

August 18th, 2009

Via: Reuters:

On Monday the Fed announced it had purchased another $7 billion worth of Treasuries under its quantitative easing program. Readers will recall that in last week’s FOMC statement, the Fed said it was extending the Treasury purchase program by a month, to the end of October, while maintaining its total purchase commitment of $300 billion.

After today’s $7 billion purchase, the Fed has just $40 billion left. Spread out over the next 10 weeks, that doesn’t give it very much ammo. To date, purchases have averaged over $12 billion per week. That is set to fall to $4 billion.


Cash-for-Clunkers Boost Japanese Car Sales

August 18th, 2009

Via: Financial Times:

The US’s cash-for-clunkers scheme, designed to bolster Detroit’s embattled carmakers, is turning out to be an even bigger boon for their Japanese rivals.

According to data published by the National Highway Traffic Safety Administration on Monday, Americans are using the scrappage incentives to buy more vehicles from Toyota than any of the three Detroit carmakers.

Toyota has an 18.9 per cent share of vehicles bought so far, putting it ahead of General Motors with 17.6 per cent and Ford with 15.4 per cent. Chrysler is in fifth place, after Honda.


95% of Dollar Bills in Washington DC Bear Traces of Cocaine

August 17th, 2009

Via: BBC:

The largest study of banknotes has found that 95% of dollar bills in Washington DC bear traces of the illegal drug cocaine.

The figure for the US capital is up 20% over two years.

Researchers at the University of Massachusetts in Dartmouth tested notes from more than 30 cities worldwide.

They say the rise observed in the US may be due to increased drug use caused by higher stress levels linked to the global economic downturn.

Bank notes can pick up traces of cocaine directly from users snorting it through rolled up bills or when cash is stacked together.

Stress factor?

Besides Washington, other big US cities such as Baltimore, Boston and Detroit had the highest average cocaine levels on their dollar bills.

Dr Yuegang Zuo, who led the research, said: “To my surprise, we’re finding more and more cocaine in banknotes.

“I’m not sure why we’ve seen this apparent increase, but it could be related to the economic downturn, with stressed people turning to cocaine.”

Other countries where notes were tested were Canada, Brazil, China and Japan.

China had the lowest rates, with only 12% of its bills contaminated.

In the US the cleanest bills were collected from Salt Lake City, home of the religious group, the Mormons.


Taliban Funding Comes Primarily from the U.S.

August 17th, 2009

Via: Global Post:

It is the open secret no one wants to talk about, the unwelcome truth that most prefer to hide. In Afghanistan, one of the richest sources of Taliban funding is the foreign assistance coming into the country.

Virtually every major project includes a healthy cut for the insurgents. Call it protection money, call it extortion, or, as the Taliban themselves prefer to term it, “spoils of war,” the fact remains that international donors, primarily the United States, are to a large extent financing their own enemy.

“Everyone knows this is going on,” said one U.S. Embassy official, speaking privately.

It is almost impossible to determine how much the insurgents are spending, making it difficult to pinpoint the sources of the funds.

Mullah Abdul Salaam Zaeef, former Taliban minister to Pakistan, was perhaps more than a bit disingenuous when he told GlobalPost that the militants were operating mostly on air.

“The Taliban does not have many expenses,” he said, smiling slightly. “They are barefoot and hungry, with no roof over their heads and a stone for their pillow.” As for weapons, he just shrugged. “Afghanistan is full of guns,” he said. “We have enough guns for years.”

The reality is quite different, of course. The militants recruit local fighters by paying for their services. They move about in their traditional 4x4s, they have to feed their troops, pay for transportation and medical treatment for the wounded, and, of course, they have to buy rockets, grenades and their beloved Kalashnikovs.

Up until quite recently, most experts thought that drug money accounted for the bulk of Taliban funding. But even here opinion was divided on actual amounts. Some reports gauged the total annual income at about $100 million, while others placed the figure as high as $300 million — still a small fraction of the $4 billion poppy industry.

Now administration officials have launched a search for Taliban sponsors. Richard Holbrooke, U.S. special envoy for Afghanistan and Pakistan, told a press conference in Islamabad last month that drugs accounted for less of a share of Taliban coffers than was previously thought.

“In the past there was a kind of feeling that the money all came from drugs in Afghanistan,” said Holbrooke, according to media reports. “That is simply not true.”

The new feeling is that less than half of the Taliban’s war chest comes from poppy, with a variety of sources, including private contributions from Persian Gulf states, accounting for much of the rest. Holbrooke told reporters that he would add a member of the Treasury Department to his staff to pursue the question of Taliban funding.

But perhaps U.S. officials need look no further than their own backyard.

Anecdotal evidence is mounting that the Taliban are taking a hefty portion of assistance money coming into Afghanistan from the outside.

This goes beyond mere protection money or extortion of “taxes” at the local level — very high-level negotiations take place between the Taliban and major contractors, according to sources close to the process.

A shadowy office in Kabul houses the Taliban contracts officer, who examines proposals and negotiates with organizational hierarchies for a percentage. He will not speak to, or even meet with, a journalist, but sources who have spoken with him and who have seen documents say that the process is quite professional.

The manager of an Afghan firm with lucrative construction contracts with the U.S. government builds in a minimum of 20 percent for the Taliban in his cost estimates. The manager, who will not speak openly, has told friends privately that he makes in the neighborhood of $1 million per month. Out of this, $200,000 is siphoned off for the insurgents.

If negotiations fall through, the project will come to harm — road workers may be attacked or killed, bridges may be blown up, engineers may be assassinated.

The degree of cooperation and coordination between the Taliban and aid workers is surprising, and would most likely make funders extremely uncomfortable.

One Afghan contractor, speaking privately, told friends of one project he was overseeing in the volatile south. The province cannot be mentioned, nor the particular project.

“I was building a bridge,” he said, one evening over drinks. “The local Taliban commander called and said ‘don’t build a bridge there, we’ll have to blow it up.’ I asked him to let me finish the bridge, collect the money — then they could blow it up whenever they wanted. We agreed, and I completed my project.”

In the south, no contract can be implemented without the Taliban taking a cut, sometimes at various steps along the way.

One contractor in the southern province of Helmand was negotiating with a local supplier for a large shipment of pipes. The pipes had to be brought in from Pakistan, so the supplier tacked on about 30 percent extra for the Taliban, to ensure that the pipes reached Lashkar Gah safely.

Once the pipes were given over to the contractor, he had to negotiate with the Taliban again to get the pipes out to the project site. This was added to the transportation costs.

“We assume that our people are paying off the Taliban,” said the foreign contractor in charge of the project.

In Farah province, local officials report that the Taliban are taking up to 40 percent of the money coming in for the National Solidarity Program, one of the country’s most successful community reconstruction projects, which has dispensed hundreds of millions of dollars throughout the country over the past six years.

Many Afghans see little wrong in the militants getting their fair share of foreign assistance.

“This is international money,” said one young Kabul resident. “They are not taking it from the people, they are taking it from their enemy.”

But in areas under Taliban control, the insurgents are extorting funds from the people as well.

In war-ravaged Helmand, where much of the province has been under Taliban control for the past two years, residents grumble about the tariffs.

“It’s a disaster,” said a 50-year-old resident of Marja district. “We have to give them two kilos of poppy paste per jerib during the harvest; then we have to give them ushr (an Islamic tax, amounting to one-tenth of the harvest) from our wheat. Then they insisted on zakat (an Islamic tithe). Now they have come up with something else: 12,000 Pakistani rupee (approximately $150) per household. And they won’t take even one rupee less.”

It all adds up, of course. But all things are relative: if the Taliban are able to raise and spend say $1 billion per year — the outside limit of what anyone has been able to predict — that accounts for what the United States is now spending on 10 days of the war to defeat them.


And Now… “Finland Denies Missing Ship Carries Nuclear Material”

August 17th, 2009

Suitable for framing.

Via: AFP:

Finland denies missing ship carries nuclear material

By Orlando Rodrigues (AFP)

PRAIA — Finnish authorities dismissed talk Sunday that the Arctic Sea was bearing a cargo of nuclear material, as Russia and NATO joined forces in an international hunt for the missing vessel.

Jukka Laaksonen, head of the Finnish Radiation and Nuclear Safety Authority, said firefighters conducted radiation tests on the ship — last reported off Cape Verde — at a port in Finland before it began a voyage full of intrigue.

But he dismissed as “stupid rumours” reports in British and Finnish newspapers that the ship could be carrying a “secret” nuclear cargo that could explain why it was attacked on the Baltic Sea before vanishing.

“Some fireman for some reason thought that there might be some radioactivity involved in this shipment and that was a very stupid idea. There was no basis for that,” Laaksonen told AFP.

Finnish police said Saturday that the ship’s Helsinki-based operator, Solchart Management, had received a ransom demand for the Arctic Sea, raising fresh hopes for its 15-strong Russian crew.

The Financial Times Deutschland newspaper, without citing a source, reported on its website that the demand was for 1.5 million dollars (1.05 million euros).

“This is the first positive sign that there are intentions to bring back the crew,” Russian maritime expert Mikhail Voitenko told AFP.

Yulia Latynina, an anti-Kremlin political commentator and a radio host in Moscow, took a similar view.

“It appears they are looking for a way out of the situation and it appears to mean that the crew will return safe and sound, thank God — and that’s the most important.”

Russian warships, backed by NATO, are scouring the Atlantic for the ship, which left Finland on July 23 on its way to Algeria with a cargo of sawn timber estimated to be worth 1.16 million euros.

The Maltese-flagged vessel was last seen off the coast of Cape Verde, officials in the west African archipelago and in France revealed Friday.

Lieutenant Colonel Antonio Monteiro, Cape Verde coastguard captain, confirmed Sunday that on Wednesday or Thursday the vessel was reported off the islands.

He said the ship had reportedly been “following a direction of 188 degrees” in international waters.

But since that sighting about 400 nautical miles (740 kilometres) off the island chain, the ship had slipped off the radar, he went on.

The lieutenant stressed it was not the Cape Verde coastguard who spotted the vessel, however, and it was only reported to the force.

As such, he could not be 100 percent certain of the sighting.

“We have not had any direct contact with the ship,” he said.

Russia has not confirmed the sighting.

In the Maltese capital Valletta, the Malta Maritime Authority told AFP on Sunday that the island nation was teaming up with Sweden and Finland to launch a criminal investigation into the disappearance.

Russia’s envoy to NATO said Saturday that the transatlantic alliance was working closely with Moscow in the hunt.

“All information that is full and most likely objective, is instantly sent to Russian navy headquarters” from NATO headquarters in Brussels, Dmitry Rogozin told the RIA Novosti news agency.

Experts are debating whether pirates, a mafia quarrel or a commercial dispute are behind the disappearance.

On the night the Arctic Sea left port in Finland last month, masked men boarded the ship between the Swedish islands of Oland and Gotland in the Baltic Sea, Swedish police reported several days after the incident.

Claiming to be anti-drugs police, they tied up the crew and conducted a thorough search of the vessel before reportedly leaving several hours later. The last definite trace of the ship was in the early hours of July 30, when its tracking system put if off the coast of northwestern France.

On Friday, European Commission spokesman Martin Selmayr said the ship appeared to have been attacked a second time, this time off the coast of Portugal.


Russia Finds Missing Cargo Ship

August 17th, 2009

Queue Twilight Zone music.

Via: BBC:

Russia says it has found a missing cargo vessel near the Cape Verde islands and retrieved its Russian crew.

Defence Minister Anatoly Serdyukov said that the 15-member crew had been taken on board a Russian navy vessel. They were in good condition, he said.

The Finnish-owned Arctic Sea went off radar after passing through the English Channel with its cargo of timber.

Speculation over the cause of its disappearance had ranged from pirates to a mafia dispute to a commercial row.

The Arctic Sea was found at 0100 Monday (2100 GMT Sunday) 300 miles (480 km) off Cape Verde in the Atlantic Ocean, Tass news agency quoted Mr Serdyukov as telling Russian President Dmitry Medvedev.


IBM Uses DNA to Make Next-Gen Microchips

August 17th, 2009

I don’t post a lot of ten-years-from-now type stories, but the weird factor on this one is pretty high.

Via: Reuters:

International Business Machines Corp is looking to the building blocks of our bodies — DNA — to be the structure of next-generation microchips.

As chipmakers compete to develop ever-smaller chips at cheaper prices, designers are struggling to cut costs.

Artificial DNA nanostructures, or “DNA origami” may provide a cheap framework on which to build tiny microchips, according to a paper published on Sunday in the journal Nature Nanotechnology.

Microchips are used in computers, cell phones and other electronic devices.

“This is the first demonstration of using biological molecules to help with processing in the semiconductor industry,” IBM research manager Spike Narayan said in an interview with Reuters.

“Basically, this is telling us that biological structures like DNA actually offer some very reproducible, repetitive kinds of patterns that we can actually leverage in semiconductor processes,” he said.

The research was a joint undertaking by scientists at IBM’s Almaden Research Center and the California Institute of Technology.

Right now, the tinier the chip, the more expensive the equipment. Narayan said that if the DNA origami process scales to production-level, manufacturers could trade hundreds of millions of dollars in complex tools for less than a million dollars of polymers, DNA solutions, and heating implements.

“The savings across many fronts could add up significantly,” he said.

But the new processes are at least 10 years out. Narayan said that while the DNA origami could allow chipmakers to build frameworks that are far smaller than possible with conventional tools, the technique still needs years of experimentation and testing.

Research Credit: ltcolonelnemo


Stocks Selling Off Around the World; U.S. Futures Down

August 17th, 2009

Via: Bloomberg:

U.S. stock-index futures retreated, indicating the Standard & Poor’s 500 Index will extend last week’s drop, as Japan’s economy grew less than estimated and commodities declined. Stocks in Asia and Europe tumbled.

Intel Corp., which gets about 60 percent of annual sales in the Asia-Pacific region, and International Business Machines Corp. fell at least 1.5 percent in Europe. Citigroup Inc. and Bank of America Corp. both sank 3.9 percent in early New York trading. Alcoa Inc. and ConocoPhillips slipped with metals and crude oil prices.

Futures on the S&P 500 expiring in September retreated 1.9 percent to 986.30 as of 11:16 a.m. in London. Dow Jones Industrial Average futures declined 1.8 percent to 9,157, while Nasdaq-100 Index futures slid 1.7 percent to 1,587.50.


Mexican Army Takes Over Customs on U.S. Border

August 17th, 2009

Via: AFP:

Mexico’s Army took control of customs Sunday on the busy US border, as federal authorities pulled agents off the job in a massive anti-corruption shakeup, officials told AFP.

An Interior Ministry official said the dismissals were being carried out at all Mexican border facilities, and that the customs agents were being replaced.

Customs agents were sacked after some were found to be linked to contraband operations, according to sources at the ministry.

Agents in Nuevo Laredo, on the border with the southern US state of Texas, were called in Saturday to be told they were fired, and to hand in their badges and weapons. A total of 1,100 agents were sacked, Mexican media said.

Army troops took over customs border posts temporarily on Sunday.


Leaked Letter: Neurologists Concerned About Swine Flu Vaccine

August 16th, 2009

Unfortunately, the Daily Mail is the original source for this story.

Via: Daily Mail:

A warning that the new swine flu jab is linked to a deadly nerve disease has been sent by the Government to senior neurologists in a confidential letter.

The letter from the Health Protection Agency, the official body that oversees public health, has been leaked to The Mail on Sunday, leading to demands to know why the information has not been given to the public before the vaccination of millions of people, including children, begins.

It tells the neurologists that they must be alert for an increase in a brain disorder called Guillain-Barre Syndrome (GBS), which could be triggered by the vaccine.

GBS attacks the lining of the nerves, causing paralysis and inability to breathe, and can be fatal.

The letter, sent to about 600 neurologists on July 29, is the first sign that there is concern at the highest levels that the vaccine itself could cause serious complications.

It refers to the use of a similar swine flu vaccine in the United States in 1976 when:

* More people died from the vaccination than from swine flu.
* 500 cases of GBS were detected.
* The vaccine may have increased the risk of contracting GBS by eight times.
* The vaccine was withdrawn after just ten weeks when the link with GBS became clear.
* The US Government was forced to pay out millions of dollars to those affected.

Concerns have already been raised that the new vaccine has not been sufficiently tested and that the effects, especially on children, are unknown.

It is being developed by pharmaceutical companies and will be given to about 13million people during the first wave of immunisation, expected to start in October.

Top priority will be given to everyone aged six months to 65 with an underlying health problem, pregnant women and health professionals.

The British Neurological Surveillance Unit (BNSU), part of the British Association of Neurologists, has been asked to monitor closely any cases of GBS as the vaccine is rolled out.

One senior neurologist said last night: ‘I would not have the swine
flu jab because of the GBS risk.’

There are concerns that there could be a repeat of what became known as the ‘1976 debacle’ in the US, where a swine flu vaccine killed 25 people – more than the virus itself.

A mass vaccination was given the go-ahead by President Gerald Ford because scientists believed that the swine flu strain was similar to the one responsible for the 1918-19 pandemic, which killed half a million Americans and 20million people worldwide.

Within days, symptoms of GBS were reported among those who had been immunised and 25 people died from respiratory failure after severe paralysis. One in 80,000 people came down with the condition. In contrast, just one person died of swine flu.

More than 40million Americans had received the vaccine by the time the programme was stopped after ten weeks. The US Government paid out millions of dollars in compensation to those affected.

The swine flu virus in the new vaccine is a slightly different strain from the 1976 virus, but the possibility of an increased incidence of GBS remains a concern.


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